Perhaps more than ever, truckers need some financial relief. With many overhead costs hitting all-time highs in 2022, expenses must be mitigated at every chance to maintain a healthy bottom line.
Fortunately, tax deductions for truckers can be pretty substantial. With the right know-how and a little time, carriers may save hundreds.
Though research and credible source documents were used in creating this guide, it’s a good idea to consult your tax advisor before making adjustments to your annual statements. This guide is not intended to replace professional counsel.
Not all drivers qualify for tax deductions.
Only self-employed carriers qualify for tax deductions on employment-related expenses. This includes contract drivers or owner-operators, but company drivers are exempt.
In short, if you receive a W-2 form, these tax deductions will most likely not apply to you.
You are good to go if you don’t fill out a W-2 form!
Deductions in trucking can come in multiple forms. Here are just a few.
For all the havoc fuel has caused to the industry in 2022, it feels fitting that truckers can claim at least one win over its brutal influence.
A quarterly International Fuel Tax Agreement should be completed to have fuel taxes deducted. This form will be in addition to your annual taxes.
Travel Costs and Meal Expenses
Burgers taste better when tax is deducted.
Deductions on meals can potentially be claimed in a few different ways:
- Long-haul/regional drivers may claim up to 50% of their meal expenses. However, if you are confined by the Department of Transportation’s hours of service, you could claim up to 80%!
- If you prefer to claim the same amount each day, you may be more inclined to the per diem method. Rates depend on the city and state, but the General Services Administration per diem rates guide provides comprehensive info. Local drivers typically do not qualify for this method.
In addition to meal deductions, hotel costs can be deducted if your route requires overnight lodging.
Though this tax deduction category is pretty wide, a good rule of thumb is that if the item must be bought for work purposes, it can likely be deducted.
Think of items that are necessary for long hours on the road. This could include any of the following:
- Cooking equipment
- Cleaning materials
- Navigation products
- Logging materials
This list does not include all items that could be tax deducted but should provide a few ideas that qualify.
Maintenance expenses pose some of the greatest opportunities for tax deductions. Just about every expense related to truck upkeep can be deducted. This includes tires, repairs, depreciation, and loan interest.
Related: How to Save on Tires
Aside from those deductions named here, smaller deductions may include medical expenses, insurance, education, licensing and association dues.
When it comes to tax deductions for truckers, the possibilities are enormous. Though your first effort at making these deductions can seem overwhelming, keep in mind that this practice can save you thousands over the years.
The England Carrier Services (ECS) division offers various services for carriers ranging from maintenance to support. As ECS members, carriers have access to nationwide discounts on fuel and tires from dedicated team members committed to finding the best price. ECS also provides factoring services with benefits such as same-day funding to a bank account or fuel card. These options allow carriers the freedom to focus on growing their business while saving time and money.